Wednesday, February 29, 2012

The Battle for Bodog

I have had Bodog on my radar for more than seven years, as Calvin Ayre's Vancouver-founded online gambling company has very publicly targeted gamblers in North America despite federal laws to the contrary. The Americans enforce theirs, Canada doesn't.

Here is my 2005 feature from the Vancouver Courier.

Bodog has been, in one word, dynamic. It branched out into mixed martial arts events and a record label. Ayre operated secretly in Vancouver before remaking himself in the image of Richard Branson and Donald Trump: a celebrity, jet-setting CEO through which others may live vicariously. It took until 2010 before many in the Canadian media took notice. Here is CTV's W5 profile on Ayre and Alwyn Morris, the Los Angeles 1984 Olympic gold medallist who is behind Bodog operations on the Kahnawake Mohawk reserve near Montreal.

Bodog was a sponsor of the 2011 Grey Cup in Vancouver, Canada's biggest annual, one-day sporting event -- under the guise of its dot-net "educational" and "free-to-play" website. The online gambling industry's dot-net sites are thinly veiled, yet vital promotional tools for the revenue-generating, dot-com websites.

The Grey Cup also receives federal and provincial subsidies. Yes, the same federal government which banned gambling (and the promotion of gambling) in the Criminal Code unless it is operated and/or licensed by a provincial government monopoly. See sections 206 and 207. In British Columbia, the B.C. Lottery Corporation's PlayNow.com is the only legal avenue (though it is still banned from taking bets on the outcome of single sporting events).

Here is academic background on the Legalization of Gambling in Canada.

In the fall of 2006, President George W. Bush signed the Unlawful Gambling Enforcement Act. Since then, U.S. authorities have methodically picked-off online gambling outfits that target Americans. It was a matter of when, not if, Bodog would become the target. That finally happened Feb. 27 when the U.S. District Court in Maryland authorized seizure of the Bodog domain. The company, Ayre, James Philip, David Ferguson and Derrick Maloney were also indicted on charges of carrying on a gambling business and conspiracy to launder money.

The whereabouts of the accused are not known, but a statement on Ayre's website says:

“I see this as abuse of the U.S. criminal justice system for the commercial gain of large U.S. corporations. It is clear that the online gaming industry is legal under international law and in the case of these documents is it also clear that the rule of law was not allowed to slow down a rush to try to win the war of public opinion... it will not stop my many business interests globally that are unrelated to anything in the U.S. and it will not stop my many charity projects through my foundation."


Ayre, ever the smooth operator, has constructed a complex web and in late 2011 even launched a whole new gambling site, called Bovada. (Get it? BOdog, neVADA?)

The question has to be asked: what is the U.S. government's end game?

Is it simply enforcing laws against unregulated gambling on moral grounds? Wherever gambling goes, the risk of crime seems to follow. There are also very real and reasonable concerns about gambling addiction. Teenage boys, who were weaned on video games and are passionate about pro sports celebrities, are particularly susceptible to online gambling. The CBC documentary Gambling Boys is enlightening. McGill University's Dr. Jeffrey Derevensky is the foremost researcher on youth gambling trends. Here is his presentation to a 2009 conference in Singapore.

Or is the U.S. government playing catch-up with technology in a bid to ensure all forms of gambling available to American citizens can be regulated and taxed? The U.S. is a major debtor and grabbing a piece of the gambling pie has been bandied about as a means of mopping up the red ink.

The U.S. government's website seizure and indictment notices against Bodog are below. This will be one of the biggest sports business stories of 2012.

Bodog Website Seizure Warrant

Bodog Indictment

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